picture of a cracked phone screen, so do i need phone insurance?

Why Cell Phone Insurance Isn’t Worth It

Mobile Phones and services are everywhere! You got AT&T, Cingular, Sprint, T-mobile, etc. Probably some of them have asked you if you’d like phone insurance, and maybe you’ve also asked yourself “do I need phone insurance?”. So, do you really need it?

This has been a rather frustrating week. First, it’s a deluge this week, so the roads are crazy here in Los Angeles (and also, we’re floating away.) Second, the hospital where my husband was scheduled for surgery screwed up the schedule and it’s been delayed. Third, as I mentioned before, the hinge on my cell phone broke. And that is what I’m going to discuss today: what a waste cell phone insurance is.

My Story of Cell Phone Insurance

do i need phone insurance? a person looking at his cellphoneI’ve been a loyal AT&T Wireless customer for several years, and I was a Cingular customer before AT&T bought them. Basically, I’ve had service with some division of their company for 13 years. In October 2008, my husband and I bought new LG CU515 phones and agreed to a two-year contract. Now 15 months in, the hinge on my phone has cracked. When we bought our phones, they asked if we wanted insurance.

I don’t usually go for these things, but we’ve had phones break before, so we said yes. One monthly insurance charge was added to our monthly bill. Now I am told that the insurance only covers my husband’s phone. We were not told the insurance would only cover one phone when we opted for it.

I called LG, but they’ve chosen not to recall the phone, despite numerous complaints on the AT&T forums and several review sites about the hinge cracking. They will apparently fix the problem free if it’s in warranty, but my phone isn’t.

I called AT&T for help, but my phone is out of warranty, they insist it’s not insured even though we thought it was, and it’s too soon for an upgrade so I can’t switch to an iPhone at the discounted price. I was told my only option is to go to one of their stores to buy a cheap GoPhone and have it added to my account. She kept saying, “We have this option for people who might be short of funds.”

I’m not short of funds, but I’m sure as hell not paying $200 for another piece of junk just to get me through the next nine months of my contract.

I explained to AT&T that my husband is scheduled for surgery and now is not a good time to be running over to the phone store. At the time of the call, his surgery was a mere 15 hours away. Yes, I can use his phone while he’s under, but I also need to be reachable on my own number. I explained this to AT&T, but only got apologies and “Sorry, a GoPhone is your only option.”

I realize that it’s not AT&T’s fault that my husband requires surgery at the same time my phone broke, but it is their fault that they sold me a phone that would not last the contracted two years. This was not a free phone – I paid $80 for it, plus the two-year contract. Without the contract, the phone would have been $200.

Is total mobile protection worth it? How much did it cost us

So far, we’ve paid $4.99 a month for 15 months. That comes to a total of $74.85. Over the term of the contract, the total cost will be $119.76. In addition, my particular model has a $50 deductible, if they were willing to replace it. Some phones have higher deductibles. The total cost to replace a phone: $169.76. I could buy a used, unlocked phone on eBay for less than that. Yes, it would be used, but it would get me through the rest of my contract. At which point, I’d have the cash to get a new phone with a new contract.

When do I need Phone Insurance?

If you have a really expensive phone, one that would cost $600-$800 to replace, then yes, the insurance might be worth it. But you’re also going to pay a high deductible, and your replacement phone will be a refurbished phone, not a new phone. So ask yourself, do you want to pay $120 for insurance plus $150 for the deductible for an old, refurbished model? And be warned that not all damage or losses are covered – so you could pay all that money and still be left without a phone.

A Better Alternative to Phone Insurance

a woman in black and white photo thinking for do i need phone insurance Alternative?Next time we renew our cell phones, I’ll be doing two things: 1. Considering switching my business to another carrier, and 2. Creating my own cell phone insurance plan. Rather than pay for crappy cell phone insurance, I’ll simply add the amount we would have paid to our emergency fund each month. Then if something happens to our phones, we’ll have the money to replace them. If nothing happens, that money is ours to keep.

Now I realize that a different carrier may be no better than AT&T, but I’m pretty ticked off right now. This phone is crap, and THEY know it’s crap, but have chosen to do nothing about it. I may just be willing to sacrifice the iPhone in order to take my money elsewhere. I could get a G-Phone! By the time I can switch, they’ll have all the G-phone kinks worked out.

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